An Empirical Study Of Traditional Financial Inclusion And Digital Financial Inclusion On Regional Economic Growth

The proposal of inclusive finance aims to provide the disadvantaged groups which are excluded from traditional financial services with reasonable cost,sustainable services and diversified financial services.With the development of the Internet,new-generation digital technologies such as big data,cloud computing,and artificial intelligence have been rapidly developed and widely penetrated and deeply integrated into the business chain of inclusive finance.Digital financial inclusion came into being and developed rapidly.The relation between financial inclusion and economic growth is controversial in academic circles,and empirical research on digital financial inclusion and economic growth is quite limited.Based on this,this paper aims to analyze the role of financial inclusion in regional economic growth.First,this paper analyzes the development history and current situation of inclusive finance in my country,and compares the business characteristics of traditional and digital inclusive finance.This paper believes that compared with traditional inclusive finance,digital technology empowers digital inclusive finance to have inherent advantages in terms of financial service coverage,costs of financial service and risk control capabilities.On this basis,this paper aims to analyze the relation between inclusive finance and economic growth,and puts forward the hypothesis that both traditional and digital inclusive finance are beneficial to economic growth.However,the concept of digital financial inclusion was proposed late,and the digital infrastructure in some regions is relatively backward,making it difficult to guarantee the development of digital financial inclusion in the local area.Based on this,this paper constructs an empirical model to test the impact of the development of traditional and digital financial inclusion on regional economic growth.Specifically,this paper uses the time series principal component analysis(GPCA)to construct the traditional financial inclusion index of 31 provinces(municipalities/autonomous regions)in my country.The idea of ??the function constructs a fixed-effect model,and uses the panel data at the national level and the panel data in the eastern,central and western regions for regression.In addition,in order to explore whether there is a nonlinear relationship between the development of traditional financial inclusion and digital financial inclusion and economic growth,this paper uses a threshold regression model to conduct regression analysis.The results show that both the development of traditional inclusive finance and digital inclusive finance have promoted my country’s economic growth,and there are regional differences in the promotion effect of each region:Traditional inclusive finance has significantly promoted the economic growth in the western and central regions,but in the eastern region,it has no effect.And there is a single threshold in the central region,after crossing the threshold,the promotion effect weakens.Digital inclusive finance has a promoting effect on economic growth in three regions of my country.There is a single threshold value in the eastern and central regions.After the threshold value is crossed,the promoting effect is strengthened.Above all,the eastern region should continue to develop digital financial inclusion,and the government of the central region should speed up the construction of digital inclusive finance.In western region,the support for the development of inclusive finance should be strengthened,in order to develop its economy.Finally,this paper puts forward some suggestions.